Axa, Europe's second-largest insurer, agreed to sell a US unit and transfer certain obligations to Protective Life for $1.06 billion (€820 million).

Axa is selling Mony Life Insurance to Protective, which will reinsure some life policies, the companies said yesterday in separate statements.

Axa said it will still offer life insurance and retirement products in the US and the agreement doesn't include the Mony distribution network.

Axa, led by chief executive Henri De Castries, had been seeking a deal to sell some US life obligations to free capital. The company has sought to expand in Asia and other emerging markets as a slow European economy and low bond yields weigh on profits.

“This transaction allows us to further grow our US business where we have been achieving good momentum while freeing up capital invested in closed portfolios to improve our financial flexibility and enable additional investment in high-growth markets and businesses,” Mr de Castries said in a statement.

Axa acquired Mony Group in 2004 for about $1.5 billion to expand in the US. The Protective deal, which includes about 560,000 life-insurance policies and 61,000 annuity contracts, primarily transfers coverage sold prior to 2004, Axa said.

After acquiring Mony, Axa sold most insurance out of other subsidiaries.
– Bloomberg